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The entrepreneur's toolkit: economics and selling

Ten lessons read from the original texts, state at 7 October 2026

Sitraka Forler, Luxembourg

Revision · 118 numbered sources · about 30 minutes

Abstract

Ten lessons for people who sell something or start something, read from the original texts: Cantillon, Smith, Marx, Cournot, Pigou, Knight, Keynes, Schumpeter, Coase, and the prize committees, regulators and university courses that carry their ideas today.

Each section follows the same order: a short answer, the key ideas with numbered sources, one figure that moves only when you press Next, a worked example from Luxembourg and the Greater Region, a common misreading, three quiz questions and free courses from Stanford, Harvard, MIT and HEC Paris.

What it refuses: no verdict between economic schools, no investment advice, no paid course presented as free.

Researched and drafted with the help of Claude Code, an Anthropic product; every fact checked against the source listed.

Reading paths

The running example, Maria

Maria starts with a market stall in Esch-sur-Alzette, opens a shop in Thionville, then a third in Metz and a fourth in Luxembourg City. Every worked example follows her one step further. She is invented: every number about her is labelled Illustrative, and every number about the world carries its source.

How to read

  • A number in brackets, such as [1], links to the reference list; hover or focus it to preview the source.
  • A dagger † marks a number that an organisation publishes about itself, such as a vendor's count of its own studies.
  • Figures move only when you press Next, one step at a time; with reduced motion the steps still change, without transitions.
  • Quizzes are for you: nothing is graded, stored or sent anywhere.

What is an entrepreneur? From Cantillon to creative destruction

An entrepreneur commits resources at a known price to sell at a price nobody knows yet. Cantillon described this in 1755 [1]; Say called the role the bearer of risk and conduct [2]; Knight separated measurable risk from true uncertainty [3]; Schumpeter made the entrepreneur the source of creative destruction [4]; Kirzner put the entrepreneur at the centre of the market process [5].

After this section you can tell risk from uncertainty, and say what the 2025 Nobel prize in economics rewarded.

The word is French before it is economic. In Cantillon's Essai, first printed in 1755 [6], country merchants buy from the farmer at a fixed price and resell in town at a price nobody can know in advance; that gap is their job and their profit. Say's Traité of 1803 [7] made the entrepreneur the person who runs a concern of industry and carries its risk.

A century later Knight explained why profit survives competition: it pays for uncertainty that no insurance table can price. Schumpeter added the dynamic view, in which new combinations replace old ones, and Kirzner a view of the market as a process moved by the entrepreneur rather than a resting equilibrium.

Key ideas.

  • Cantillon's merchants buy country produce at a certain price, “pour les revendre en gros ou en détail à un prix incertain” [1].
  • Say's English translator renders entrepreneur as adventurer, for want of a better word: the person who takes on the responsibility, the risk and the conduct of a concern of industry [2].
  • Knight: uncertainty that can be measured, risk proper, is so far from the unmeasurable kind that it is hardly uncertainty at all; only the unmeasurable kind explains profit [3] [8].
  • Schumpeter: “This process of Creative Destruction is the essential fact about capitalism.” [4]
  • Kirzner (1973) points out the shortcomings of the textbook equilibrium model and offers a market-process view centred on the entrepreneur [5].
  • In 2025 the prize in economics went half to Joel Mokyr and half jointly to Philippe Aghion and Peter Howitt, for the theory of sustained growth through creative destruction [9]; the committee's scientific background is free to read [10].

Creative destruction, in one paragraph

The Nobel committee's popular text puts it simply: sustained growth happens when new technologies replace old ones, the process known as creative destruction [11]. It is also why incumbents worry: Bower and Christensen describe leading companies that lose their place when technologies or markets change [12].

Risk or uncertainty: Knight's distinction

Risk is a chance you can measure, so you can insure it or build it into a price. Uncertainty has no table of odds: a new product, a new town, a new kind of buyer. Knight's point is that profit rewards good judgment under the second kind [3]. Figure 1.1 draws the difference with one market day.

Certain price in, uncertain price out.A farmer, Maria and a town market. Maria pays 2.00 euros a kilo for 100 kilos; on a sunny day she sells 90 kilos at 2.80 euros, a margin of 52 euros; on a rainy day 60 kilos at 2.50 euros, a loss of 50 euros. No probability is given for the weather.FarmerMariaMarket€2.00/kgcertainpaid €200?uncertainno odds givenSun: 90 kg × €2.80 = €252margin +€52Rain: 60 kg × €2.50 = €150loss −€50No table of odds: uncertainty, not risk.
All 5 steps

Both market days at once: the price paid is certain, the price received is not. Press Next to go step by step.

  1. 1Maria buys from the farmer at a fixed price: €2.00 a kilo.
  2. 2She pays now: 100 kg cost her €200.
  3. 3The selling price is unknown, and no table gives the odds of sun or rain.
  4. 4Sun: 90 kg at €2.80 bring €252, a margin of €52.
  5. 5Rain: 60 kg at €2.50 bring €150, a loss of €50. No table gave the odds: that is uncertainty, not risk.
Figure 1.1: Certain price in, uncertain price out. The merchant pays a known price today and sells at a price no table can give in advance. Sources: [1] [3] · Illustrative

Example 1.1 (Illustrative, Esch-sur-Alzette)

Maria starts with a market stall in Esch-sur-Alzette, selling fruit and apple tarts. On Friday she buys 100 kg of Moselle apples at €2.00 a kilo: €200, paid now, at a certain price.

Sunny Saturday: she sells 90 kg at €2.80, which is €252, a margin of €52. Rainy Saturday: she sells 60 kg at €2.50, which is €150, a loss of €50. No table tells her which Saturday it will be: that is uncertainty, not risk.

Before she registers anything, Guichet.lu's pages on starting a business list the legal forms, the simplified SARL-S among them [13]. Luxinnovation, the national innovation agency [14], and the House of Entrepreneurship of the Chamber of Commerce [15] are the public entry points.

Remark 1.1 (Common misreading: “the entrepreneur is a risk lover”). Knight's point is the opposite of gambling. Profit rewards judgment under uncertainty that cannot be insured, not a taste for risk [3]. Maria buys apples because she has read her market, not because she enjoys the chance of a loss.

Quiz 1.

  1. 1.1 In Knight (1921), what is “risk”?

    Answer

    Answer (b): Knight keeps “risk” for measurable uncertainty and “uncertainty” for the kind that cannot be measured [3].

  2. 1.2 Who shared the 2025 prize in economics for the theory of growth through creative destruction?

    Answer

    Answer (a): Half the prize went to Aghion and Howitt for that theory, the other half to Joel Mokyr [9].

  3. 1.3 In Cantillon's Essai, the merchant buys at a ... price and resells at a ... price.

    Answer

    Answer (b): A certain price in, an uncertain price out: that gap is the entrepreneur's job [1].

Go further (free)

On this site

Sources for §1: [1] [2] [3] [4] [5] [6] [7] [8] [9] [10] [11] [12] [13] [14] [15] [16] [17] [18], checked 7 October 2026. Back to contents.

Classical, Marxist, Keynesian, neoliberal: what does each school say?

Classical economists trust self-interest in competitive markets and give the state a few duties [19]. Marx sees profit as surplus-value taken from labour [20]. Keynes says demand drives output and markets do not restore full employment alone [21]. The neoliberal programme favours competition and a smaller state [22]. Each school has a serious critique, cited below.

After this section you can place an argument in its school, and name that school's best-known critique.

Four schools answer the same four questions: who is the entrepreneur, what does the market do, what should the state do, and where does profit come from. Table 2.1 gives each school in its own words first, then the strongest critique from outside it, with the same number of cells for each. The page takes no side.

Table 2.1: Four schools, the same four questions, in alphabetical order of their English names. The last column is the main critique from outside the school.
SchoolEntrepreneurMarketStateProfitOwn textsMain critique
Classical (liberal in the French sense)Say's “adventurer”, who carries the risk and the conduct of a concern [2]Self-interest serves others: we expect our dinner from the butcher's regard to his own interest [19]Under natural liberty, three duties only: defence, justice and certain public works [19]Shared among proprietor, capitalist and labourer; one person can hold all three roles [2]Smith 1776 [19]; Say 1803 [7]Keynes: the classical postulates leave no room for involuntary unemployment [23]
KeynesianInvests on “animal spirits”, a spontaneous urge to act rather than to wait [24]Free markets have no self-balancing mechanism that leads to full employment [21]Steadies demand; the faults to fix are unemployment and an arbitrary, inequitable distribution [25]Earned on investment that rests on expectations, on confidence as much as on calculation [24]General Theory 1936 [23]; IMF primer [21]1970s stagflation and the monetarist critique [21]; Friedman's 1976 prize [26]
MarxistThe capitalist, who advances money in order to end the cycle with more money [20]Money turns into capital by buying in order to sell, and to sell for more [20]The executive of the modern state manages the common affairs of the whole bourgeoisie [27]The increment over the value first advanced, which Marx calls “surplus-value” [20]Capital I, ch. 4 [20]; Manifesto [27]Böhm-Bawerk (1896) on Marx's theory of value and the close of his system [28]
NeoliberalActs within private property and the competitive market, which the Mont Pelerin Society set out to defend [29]More competition, through deregulation and opening markets to foreign competition [22]A smaller role: privatisation, limits on deficits and debt [22]; Williamson's Washington list [30]No single statement in the founding text; see Kirzner's market-process view in §1 [5]Mont Pelerin 1947 [29]; Hayek's 1974 prize [31]IMF economists (2016): some neoliberal policies have increased inequality [22]

Key ideas.

  • “Neoliberal” is, in the IMF authors' words, “a label used more by critics than by the architects of the policies”; this page uses it as a historian's label, never as an insult [22].
  • Keynes named the two outstanding faults of the economy he lived in: it fails to provide full employment, and it distributes wealth and incomes in an arbitrary and inequitable way [25].
  • Smith's three duties make the classical state small, not absent [19].
  • Hayek shared the 1974 prize with Gunnar Myrdal, for pioneering work on the theory of money and economic fluctuations [31].

Keynesian or classical: the short version

The classical view expects prices and wages to adjust until markets clear, so lasting unemployment needs another cause; Keynes wrote that its postulates leave no room for involuntary unemployment [23]. In the IMF primer's summary, Keynes held that free markets have no self-balancing mechanism leading to full employment, so demand can stay too low for long and the state can fill the gap [21].

What is neoliberalism?

In the IMF article, the neoliberal agenda rests on two planks: more competition, through deregulation and the opening of domestic markets, and a smaller role for the state, through privatisation and limits on deficits and debt [22]. Williamson's 1990 paper set out the reforms that Washington institutions then regarded as desirable [30]. Figure 2.1 draws one economy and lights it the way each school does, one school per step.

Four schools, one economy.A circular flow between households, firms, the state and banks. Each step highlights the flows one school treats as decisive (classical, Keynesian, Marxist, neoliberal, in alphabetical order) and writes that school's summary and the main critique from outside it.StateHouseholdsFirmsBanksspendingwages, profitstaxespublic spendingsavinginvestmentClassical · Keynesian · Marxist · NeoliberalPress Next to read the same economy as each school does.State: defence, justice, certain public worksClassical: self-interest in competitive markets servesothers; the state keeps three duties (Smith).Critique (Keynes): no room for involuntary unemployment.outputfull employmentKeynesian: demand drives output; no self-balancing return tofull employment, so the state fills the gap.Critique: 1970s stagflation and the monetarist view.paid labour timeunpaid: surplus-valueMarxist: money becomes capital by buying to sell for more;profit is surplus-value from labour.Critique (Böhm-Bawerk, 1896): the theory of value.Deregulation · open markets · privatisationNeoliberal: more competition, markets open to foreigncompetition, a smaller state.Critique (IMF economists, 2016): some policies increasedinequality.
All 5 steps

The neutral diagram. Press Next to light it as each school does, in alphabetical order.

  1. 1One economy: households, firms, the state and banks, every flow drawn the same.
  2. 2Classical: self-interest in competitive markets; the state keeps three duties. Critique (Keynes): no room for involuntary unemployment.
  3. 3Keynesian: demand drives output and nothing brings it back to full employment alone; the state fills the gap. Critique: 1970s stagflation and the monetarist view.
  4. 4Marxist: profit is surplus-value, the unpaid part of labour time. Critique (Böhm-Bawerk, 1896): the theory of value.
  5. 5Neoliberal: more competition, open borders, a smaller state. Critique (IMF economists, 2016): some of these policies increased inequality.
Figure 2.1: Four schools, one economy. The same circular flow, lit the way each school reads it, with that school's best-known critique beside it. Sources: [19] [21] [20] [22]

Example 2.1 (Luxembourg, a reading exercise)

Since 2021 fossil fuels used for transport or heating pay a CO2 tax in Luxembourg, in order to curb and reduce their use [32]. The carbon price reaches €45 per tonne of CO2 in 2026 [33]. The revenue funds climate measures, social compensation for low-income households and the energy transition [32], and the CO2 tax credit rises by €24 to €216 [34]. Maria's delivery van in Esch runs on diesel that pays it.

Exercise. Which question would each school ask first? The answer key states each question in the school's own logic:

  • Classical: does the tax send a clear price signal through the market, and does its revenue serve the few duties the state should hold?
  • Keynesian: what does the tax do to the spending of low-income households, and so to demand in the economy as a whole?
  • Marxist: who bears the cost in the end, wage earners or the owners of capital, and who decides how the revenue is spent?
  • Neoliberal: is a price on carbon, left to competition, a better tool than rules and subsidies, and does the state stay small while it collects it?

The key gives no verdict: each question is legitimate within its own school, and the figures above are the same for all four.

Remark 2.1 (Common misreading: ““liberal” means the same everywhere”). In French « libéral » is close to the classical market view; in American English “liberal” usually means centre-left. This page writes “classical liberal” when it means the first, and uses “neoliberal” only in the historian's sense of the IMF article [22].

Quiz 2.

  1. 2.1 Which statement is Keynes's?

    Answer

    Answer (b): That is the IMF primer's summary of Keynes [21]. The other three belong to the classical view, Marx and Smith.

  2. 2.2 In Capital, what does Marx call the increment over the value first advanced?

    Answer

    Answer (b): Chapter 4 names it surplus-value [20].

  3. 2.3 According to the IMF authors (2016), who uses the word “neoliberal” most?

    Answer

    Answer (b): In their words, “a label used more by critics than by the architects of the policies” [22].

Go further (free)

On this site

Sources for §2: [19] [20] [21] [22] [2] [7] [23] [24] [25] [26] [27] [28] [29] [30] [5] [31] [32] [33] [34] [35] [36], checked 7 October 2026. Back to contents.

What is Cournot competition? Oligopoly with a worked example

In Cournot competition, a few firms each choose how much to produce, taking the others' output as given; the market price follows from total output. With two firms the price lands between monopoly and perfect competition, and it falls as firms are added. Cournot published the model in 1838, with two mineral springs [37] [38].

After this section you can compute a Cournot equilibrium and explain why a third competitor lowers the price.

Most markets a small business meets are neither a monopoly nor a crowd of identical sellers: they are an oligopoly, a few rivals who watch each other. Cournot's model is the simplest way to see what happens there. Each firm picks a quantity; the price is whatever clears the market for the total; each firm adjusts to the others until nobody wants to move. That resting point is the Cournot equilibrium.

Key ideas.

  • Cournot, chapter VII: “Let us now imagine two proprietors and two springs of which the qualities are identical” [38], both selling into the same market. The French original of 1838 is on Gallica [37].
  • Oligopoly is a standard topic of MIT's introductory microeconomics, listed with monopoly, welfare economics and externalities [39].
  • Game theory, the modern frame for Cournot's reasoning, is “the mathematical analysis of strategic interaction” [40].
  • Porter adds four forces beyond direct rivals: customers, suppliers, potential entrants and substitute products [41].
  • For a seller: in a market of few rivals, your volume decision moves the price for everyone, you included.

A worked example of Cournot competition

Take a straight demand line, P = 100 − Q, and a cost of 10 per unit for every firm (Illustrative numbers). With N identical firms the equilibrium is Q = 90 × N / (N + 1) and P = 10 + 90 / (N + 1). One firm, a monopoly, makes 45 units and charges 55. Two firms make 30 each, 60 in all, and the price is 40. Ten firms bring the price to about 18.2, and with very many firms it tends to the cost of 10. Figure 3.1 steps through N = 1, 2, 3, 5 and 10.

From one spring to many.Demand line P = 100 minus Q and a cost line at 10. The equilibrium point moves down the demand line as the number of firms grows: one firm, Q 45 and P 55; two, Q 60 and P 40; three, Q 67.5 and P 32.5; five, Q 75 and P 25; ten, Q 81.8 and P 18.2.PQ10010100demand P = 100 − Qcost 101 firmmany firmsN = 1N = 1Q = 45P = 55profit 2,025N = 2N = 2Q = 60P = 40profit 1,800N = 3N = 3Q = 67.5P = 32.5profit 1,518.75N = 5N = 5Q = 75P = 25profit 1,125N = 10N = 10Q = 81.8P = 18.2profit 669.42each firm's share of Q
All 5 steps

Key frame: Cournot's own case, two firms, with the monopoly and the many-firm limit in grey.

  1. 1N = 1, a monopoly: Q = 45, P = 55, profit 2,025.
  2. 2N = 2, Cournot's two springs: 30 each, Q = 60, P = 40, total profit 1,800.
  3. 3N = 3: 22.5 each, Q = 67.5, P = 32.5, total profit 1,518.75.
  4. 4N = 5: 15 each, Q = 75, P = 25, total profit 1,125.
  5. 5N = 10: Q = 81.8, P = 18.2, total profit 669.4. With very many firms the price tends to the cost, 10.
Figure 3.1: From one spring to many. Each firm added raises total output and lowers the price toward the cost of 10. Sources: [38] [39] · Illustrative

Example 3.1 (Illustrative, Esch-sur-Alzette)

Maria's stall becomes a small bakery in Esch. One rival bakery serves the same street. Each evening both decide how many croissants to bake, and the morning price settles on what the street will pay for the total. Read the numbers of Figure 3.1 as cents per croissant and dozens per morning: two bakeries sell 30 dozen each at 40 cents; if a third opens, the price falls to 32.5 cents and each sells 22.5 dozen.

Concentrated markets are real next door. The regulator's 2025 telecoms report notes that Post Luxembourg's share of mobile subscribers has stayed above 50 % since 2024, with few changes in market shares between 2021 and 2025 [42] [43]. That describes concentration only: no source read for this page says that Luxembourg mobile prices follow Cournot's model, and the page does not claim it.

Remark 3.1 (Common misreading: “two firms means perfect competition”). In Cournot's model two firms still charge well above cost: 40 against a cost of 10 in the example. Only many firms push the price down toward cost [38].

Quiz 3.

  1. 3.1 In Cournot's model, what do the firms choose?

    Answer

    Answer (b): Each firm chooses a quantity; the price follows from total output [38].

  2. 3.2 Demand P = 100 − Q, a cost of 10 per unit, two firms. What is the equilibrium price?

    Answer

    Answer (b): Each firm makes 30, so Q = 60 and P = 100 − 60 = 40.

  3. 3.3 What did Cournot use as his first example of duopoly?

    Answer

    Answer (b): Two proprietors and two springs of identical quality [38].

Go further (free)

Sources for §3: [37] [38] [39] [40] [41] [42] [43] [44], checked 7 October 2026. Back to contents.

Sitraka FORLERsystems architect, Luxembourg
The entrepreneur's toolkit
Part I of IVnext: Practice →

How do you find out what customers need? Customer discovery

Customer discovery means leaving the building to test your guesses with real buyers before you build much. Steve Blank's method, taught in Stanford's Lean LaunchPad and the NSF I-Corps programme, sets a pace of 10 to 15 interviews a week [45] [46]. MIT's Disciplined Entrepreneurship turns the same idea into 24 steps [47] [48].

After this section you can plan a week of customer interviews and decide what to keep, drop or rewrite.

A business plan is a list of guesses. Customer discovery treats it that way: write each guess down, go and ask the people who would pay, and change the plan on evidence. Blank wrote in 2013 that the lean start-up may make business plans obsolete, against the old routine of writing a plan, pitching it, building, then selling as hard as you can [49].

Key ideas.

  • At Stanford in spring 2026, “the eight teams spoke to 978 potential customers, beneficiaries and regulators”; the class sets a goal of 10 to 15 customer interviews a week [45].
  • The US National Science Foundation runs the method as I-Corps, “an immersive, entrepreneurial training program that facilitates the transformation of invention to impact” [46].
  • Aulet's framework at MIT, Disciplined Entrepreneurship, is a book of 24 steps first released in August 2013 and taught in 15.390 [47] [50] [51]. This page names no single step: the free chapters were not read for it.
  • Blank's free Udacity course teaches founders to get out of the building to gather feedback and iterate [52].
  • Christensen and co-authors ask what job the customer is trying to get done, the jobs to be done of their title [53].
  • Stanford eCorner sums up the habit: to understand what your customers need, want and experience, spend time with them [16].

Figure 4.1 plays one week of interviews on a board of six guesses.

Guess, ask, keep or drop.Six guesses about Thionville commuters drawn as dashed notes. Each step plays two interviews; a note turns solid when kept, is struck through when dropped, or is rewritten. After twelve interviews three notes are kept, two dropped and one rewritten as coffee and pre-order.Interviews this week:2/124/126/128/1210/1212/12Commuters wantbreakfastCoffee andpre-orderThey will pay €6Before the 7:10trainCoffee matters mostOrdering aheadappealsThey eat on thetrain“I eat at home before I leave.”“I'd take a coffee on the platform.”“€6 for breakfast? No.”“I'm always here before seven.”“I'd order the evening before, on my phone.”“So: a coffee, ordered ahead.”Three kept · two dropped · one rewrittenSolid frame: kept. Struck: dropped. Gold frame: rewritten.Answers Illustrative.
All 6 steps

The board after the week: twelve interviews, three guesses kept, two dropped, one rewritten.

  1. 1Interviews 1 and 2: “I eat at home before I leave.” The note “they eat on the train” is dropped.
  2. 2Interviews 3 and 4: “I'd take a coffee on the platform.” “Coffee matters most” is kept.
  3. 3Interviews 5 and 6: “€6 for breakfast? No.” “They will pay €6” is dropped.
  4. 4Interviews 7 and 8: “I'm always here before seven.” “Before the 7:10 train” is kept.
  5. 5Interviews 9 and 10: “I'd order the evening before, on my phone.” “Ordering ahead appeals” is kept.
  6. 6Interviews 11 and 12: the breakfast guess is rewritten as “coffee and pre-order”. Three kept, two dropped, one rewritten.
Figure 4.1: Guess, ask, keep or drop. Evidence, not opinions, moves a note: three guesses kept, two dropped, one rewritten in twelve interviews. Sources: [49] [45] · Illustrative

Example 4.1 (Illustrative, Thionville)

Maria opens her second shop, in Thionville. She guesses that commuters want breakfast before the 7:10 train to Luxembourg. In one week she holds twelve interviews at the station, within Blank's pace: eight already eat at home, three would buy a coffee only, one wants to order the evening before.

Decision: drop “breakfast”, test “coffee and pre-order”. Twelve interviews in five mornings is a small project; the project management summaries linked below help to plan it week by week.

Remark 4.1 (Common misreading: “friends' enthusiasm is validation”). Blank's own list of tools includes a talk titled Customers Lie and a warning against telling yourself what you want to believe [54]. Polite praise is not a purchase.

Quiz 4.

  1. 4.1 What weekly interview pace does Blank's Stanford class set?

    Answer

    Answer (b): The class sets a goal of 10 to 15 customer interviews a week [45].

  2. 4.2 How many steps does Aulet's Disciplined Entrepreneurship have?

    Answer

    Answer (c): The book's full title is Disciplined Entrepreneurship: 24 Steps to a Successful Startup [47].

  3. 4.3 Which US agency runs the Lean LaunchPad method as I-Corps?

    Answer

    Answer (b): NSF I-Corps is the agency's entrepreneurial training programme [46].

Go further (free)

On this site

Sources for §4: [45] [46] [47] [48] [49] [50] [51] [52] [53] [16] [54] [55], checked 7 October 2026. Back to contents.

How do you sell and set a price? SPIN questions and value

In larger sales, the seller who asks better questions does better. Rackham's SPIN method orders them: Situation, Problem, Implication, Need-payoff [56]. Price is the other lever: Marn and Rosiello wrote that the right price can lift profit faster than more volume [57]. Value is what the buyer gains, which an HBR study splits into thirty elements [58].

After this section you can write the four SPIN questions for one buyer and show what 1 % of price does to profit.

Selling is not talking well; it is finding out what the buyer loses today and what your offer changes. Setting a price is the same question in numbers: what is the change worth to that buyer, and what does each euro of price do to your own profit?

Key ideas.

  • SPIN Selling (McGraw-Hill, May 1988) sets out the SPIN strategy: Situation, Problem, Implication, Need-payoff [56].
  • Marn and Rosiello: “The right price can boost profit faster than increasing volume will; the wrong price can shrink it just as quickly.” [57]
  • Almquist, Senior and Bloch argue that value has universal building blocks; their article lists thirty elements of consumer value [58].
  • Kahneman's 2002 prize recognised that human judgment takes heuristic shortcuts that depart from basic principles of probability [59]: the first number a buyer sees matters (anchoring, §6).

Note on numbers. The publisher presents SPIN as the result of a 12-year, one-million-dollar research programme† [56], and the training firm cites more than 35,000 observed sales calls† [60]. Both are the authors' and the vendor's own claims.

SPIN selling: the four questions

Situation questions collect facts. Problem questions find a difficulty. Implication questions make the cost of that difficulty visible. Need-payoff questions let the buyer say what solving it is worth. The example below writes one invented line of each for Maria (Illustrative). Figure 5.1 shows why the price itself deserves the same care.

One per cent of price.Bars for 100 euros of sales split into variable costs 60, fixed costs 30 and profit 10. Price up 1 %: profit 11, plus 10 %. Volume up 1 %: profit 10.40, plus 4 %. Price down 1 %: profit 9, minus 10 %.Base: €100 of sales10Price +1 %11 (+10 %)Volume +1 %, same price10.4 (+4 %)Price −1 %9 (−10 %)variable costsfixed costsprofit
All 4 steps

All three cases against the base of €100 of sales and a 10 % margin.

  1. 1Price up 1 %: sales €101, costs unchanged, profit 10 → 11, plus 10 %.
  2. 2Volume up 1 % at the same price: sales €101, variable costs €60.60, profit 10.40, plus 4 %.
  3. 3Price down 1 %: sales €99, profit 9, minus 10 %.
  4. 4The three outcomes side by side: the price moves profit two and a half times as much as the volume.
Figure 5.1: One per cent of price. With a 10 % margin, 1 % of price is 10 % of profit (Illustrative arithmetic, not Marn and Rosiello's own figures). Sources: [57] · Illustrative

Example 5.1 (Illustrative, Metz)

Maria now has a third shop, in Metz, and an office near the station asks about lunch deliveries. Her four questions:

  • Situation: “How many people eat on site each day?”
  • Problem: “What happens when the canteen closes in August?”
  • Implication: “What does it cost you when people leave the building for an hour?”
  • Need-payoff: “If lunch came to your floor, what would that change for you?”

She sets the price from what the change is worth to the office, not from her cost plus a margin. Then she checks her own arithmetic with Figure 5.1: on €100 of sales with a 10 % operating margin, 1 % more on the price adds €1 of profit, a tenth more; 1 % more volume at the same price adds only €0.40.

Remark 5.1 (Common misreading: “a discount is free volume”). With a thin margin a small price cut removes a large share of profit: in Figure 5.1, 1 % off the price takes profit from 10 to 9, a tenth of it [57].

Quiz 5.

  1. 5.1 What does the “I” in SPIN stand for?

    Answer

    Answer (b): Situation, Problem, Implication, Need-payoff [56].

  2. 5.2 Operating margin 10 %, price up 1 %, volume unchanged: by how much does operating profit change?

    Answer

    Answer (c): On €100 of sales the extra euro goes straight to profit, which moves from 10 to 11.

  3. 5.3 Which number about SPIN research is the method's vendor's own claim?

    Answer

    Answer (a): The training firm publishes it about its own research; the page marks it with a dagger [60].

Go further (free)

Sources for §5: [56] [57] [58] [59] [60] [61] [16] [62], checked 7 October 2026. Back to contents.

What is a BATNA? Negotiation, ZOPA and anchoring

Your BATNA is your best alternative to a negotiated agreement: what you will do if this deal fails. Harvard's Program on Negotiation calls it the true measure of any proposed agreement [63]. The ZOPA is the range where both sides' limits overlap [64]. The first number on the table, the anchor, pulls the outcome when that range is unclear [65].

After this section you can name your BATNA, find the ZOPA and decide whether to make the first offer.

A negotiation is largely decided before the meeting, by what each side can do if it walks away. That alternative is the BATNA; the overlap of the two sides' limits is the ZOPA; and inside it, the first number spoken works as an anchor.

Key ideas.

  • “Your BATNA ... is the true measure by which you should judge any proposed agreement.” [63]
  • The concept comes from Roger Fisher, William Ury and Bruce Patton's book Getting to Yes [66], which PON describes as a universal method for negotiating personal and professional disputes [67].
  • Together, ZOPA and BATNA help a negotiator avoid the agreement trap and the myth of a fixed pie [64].
  • Anchoring is “considered a ‘bias’ because it distorts our judgment, especially when the bargaining zone is unclear”; to the question whether you should make the first offer, PON answers: typically yes [65].
  • MIT teaches the same tools through simulations in 15.665 Power and Negotiation and 15.067 Competitive Decision-Making and Negotiation [68] [69].

The ZOPA, in one example

If the lowest salary a candidate accepts is €66,000 and the most an employer will pay is €78,000, any figure between the two can close the deal: that range is the ZOPA. If the candidate needed €80,000, there would be no ZOPA and no deal, however skilful the talk (Illustrative numbers). Figure 6.1 adds the anchors.

Where a deal can happen.A salary axis from 60,000 to 90,000 euros. The candidate's BATNA at 66,000 and the employer's limit at 78,000 mark the ZOPA. The employer anchors at 64,000, the candidate counters at 80,000 and the deal lands at 74,000.60657075808590ZOPAcandidate's BATNA€66kMaria's limit€78kanchor €64kexpectations pulled downcounter €80kdeal €74k
All 5 steps

The whole negotiation on one axis: two limits, the ZOPA, two anchors and the deal.

  1. 1The candidate's BATNA: an offer in Metz she values at €66,000.
  2. 2Maria's limit for the post: €78,000.
  3. 3The overlap, from €66,000 to €78,000, is the ZOPA.
  4. 4Maria anchors at €64,000, below the ZOPA, and pulls expectations down.
  5. 5The candidate counters at €80,000 with market data; they settle at €74,000.
Figure 6.1: Where a deal can happen. Know your BATNA before the first number. Sources: [63] [64] [65] · Illustrative

Example 6.1 (Illustrative, Metz and Luxembourg City)

Maria prepares her fourth shop, in Luxembourg City, and needs a shop manager. Her limit is €78,000 a year. The best candidate lives in Metz and holds an offer there that she values at €66,000: that offer is her BATNA. Maria opens at €64,000, below the ZOPA; the candidate answers €80,000 with market data; they settle at €74,000.

Comparing gross salaries across the border is not enough: tax, the commute and telework days change what an offer is worth, and this page prints no tax figure because none was verified for it. The two pages linked below help a frontalier compare.

Remark 6.1 (Common misreading: “a BATNA is my bottom line”). The bottom line is a number; the BATNA is a course of action, and improving it moves the bottom line [63] [66]. The candidate's Metz offer is what gives her figure its weight.

Quiz 6.

  1. 6.1 What does BATNA stand for?

    Answer

    Answer (a): The best alternative to a negotiated agreement, the measure of any offer [63].

  2. 6.2 Your limit is €66,000, the employer's is €78,000. Where is the ZOPA?

    Answer

    Answer (b): The ZOPA is the overlap of the two limits.

  3. 6.3 According to Harvard's Program on Negotiation, should you usually make the first offer?

    Answer

    Answer (b): PON's answer is typically yes, from the research on anchoring [65].

Go further (free)

On this site

Sources for §6: [63] [64] [65] [66] [67] [68] [69] [44], checked 7 October 2026. Back to contents.

Sitraka FORLERsystems architect, Luxembourg
The entrepreneur's toolkit
Part II of IVnext: Rules of the game →

What is a Pigouvian tax? Pigou, Coase and the Luxembourg CO2 tax

A Pigouvian tax charges an activity for the harm it does to others, so that the price includes that cost. Pigou named bounties and taxes as the tools in 1920 [70]. Coase answered that, if bargaining were costless, the parties would reach the efficient outcome whoever holds the rights; real transaction costs bring institutions back in [71].

After this section you can read the Pigou diagram, state the Coase theorem in Coase's words and compute a CO2 tax bill.

When a factory's smoke dirties the neighbours' washing, the factory's price leaves out a cost that others pay. Economists call that an externality. Pigou's remedy is a Pigouvian tax equal to the harm, so that the price tells the truth. Coase looked at the same case from the side of rights and bargaining, and found that what blocks a deal is the transaction costs.

Key ideas.

  • Pigou (1920), Part II, chapter IX: “The most obvious forms, which these encouragements and restraints may assume, are, of course, those of bounties and taxes.” The same chapter's example is smoke from factory chimneys [70].
  • Coase, in his Nobel lecture: with zero transaction costs, negotiation leads to the arrangements that maximise wealth, whatever the initial assignment of rights. He adds that it is “the infamous Coase Theorem, named and formulated by Stigler” [71].
  • The 1991 prize went to Coase for the discovery and clarification of the significance of transaction costs and property rights [72].
  • Luxembourg has taxed fossil fuels for their CO2 since 2021 [32]; the carbon price is €45 per tonne in 2026 [33]; the CO2 tax credit rises by €24 to €216 [34].
  • Worldwide, about 28 % of greenhouse gas emissions are now covered by a carbon price, according to the World Bank (2025) [73].

A Pigouvian tax example: the Luxembourg CO2 tax

The CO2 tax puts a price on each tonne emitted by burning fuel, so the cost of the emission enters the price of the fuel. Table 7.1 sets its strengths against its limits, each line attributed.

Table 7.1: The Luxembourg CO2 tax read as a Pigouvian tax: what it does, and what limits it. Rows checked on 7 Oct 2026.
SidePointReading
StrengthPrice signalFossil fuels pay the tax in order to curb and reduce their use [32]
StrengthRevenueFunds climate measures, social compensation and the energy transition [32]
LimitThe right ratePigou's rule asks for a tax equal to the harm, which nobody measures exactly; the rate follows the national plan's path, €45 in 2026 [33]
LimitWho paysA tax on fuel reaches every household; the state pairs it with social compensation [32] and a CO2 tax credit of €216 [34]
LimitBordersFuel can be bought on either side of a border, so a national price meets its neighbours' prices (this page's remark; no figure printed)

The Coase theorem, in Coase's words

Coase's own statement: if transaction costs were zero, negotiations between the parties would lead to the arrangements that maximise wealth, irrespective of the initial assignment of rights [71]. His point was the other side of it: transaction costs are never zero, so the law, the courts and the firm decide who does what. Figure 7.1 shows both readings on one diagram.

Closing the gap.Demand, private marginal cost and social marginal cost lines. The market settles where demand meets private cost; the damage band and the over-production triangle appear; a tax equal to the damage moves the equilibrium to the social optimum with a tax revenue rectangle. In the Coase view a bargaining table replaces the triangle, then greys out when transaction costs are high.PQDMPCQmMSC = MPC + damageover-productionQ*tax revenuea deal reaches Q*costs high: no deal
All 5 steps

Key frame: the Pigouvian tax at work. Press Next to see the market, the damage, then Coase's two cases.

  1. 1The market settles where demand meets private marginal cost: quantity Qm.
  2. 2The damage to others lifts social cost above private cost; the hatched triangle is over-production.
  3. 3A tax t equal to the damage lifts private cost onto social cost: output falls to Q*, and the shaded rectangle is the tax revenue.
  4. 4Coase's view: with zero transaction costs, the parties reach the same Q* by a deal, whoever holds the right.
  5. 5With high transaction costs the table stays empty: the law, the courts or a tax decide.
Figure 7.1: Closing the gap. A tax equal to the damage brings output down to the social optimum; with costless bargaining a deal does the same, with costly bargaining it does not. Sources: [70] [71] · Illustrative

Example 7.1 (Luxembourg, computed; Moselle, Illustrative)

Maria's shops and vans burn fuel that emits, say, 100 tonnes of CO2 a year (Illustrative quantity). At the 2026 carbon price of €45 per tonne [33], the CO2 tax in that fuel comes to 100 × €45 = €4,500 a year. A household eligible for the full CO2 tax credit receives €216 [34]. No figure per litre is printed: the emissions of one litre were not verified for this page.

Coase on the Moselle (Illustrative): a winemaker's spray drifts onto a neighbour's organic plot. If the two can talk cheaply, they agree a buffer strip and a payment, whoever holds the right. If talks are costly (many plots, a lawyer each, a court date), the same harm ends at the commune or in court. No real case is named.

Remark 7.1 (Common misreading: “Coase proved taxes are useless”). Coase's lecture stresses that real transaction costs are not zero, which is exactly why institutions matter [71] [72].

Quiz 7.

  1. 7.1 In 1920, which two tools does Pigou name to correct a gap between private and social interest?

    Answer

    Answer (b): “Bounties and taxes”, in Part II, chapter IX [70].

  2. 7.2 According to Coase, who named and formulated the “Coase theorem”?

    Answer

    Answer (c): Coase says so in his Nobel lecture [71].

  3. 7.3 What is Luxembourg's carbon price per tonne of CO2 in 2026?

    Answer

    Answer (c): €45 per tonne, in line with the national energy and climate plan [33].

Go further (free)

On this site

Sources for §7: [70] [71] [72] [32] [33] [34] [73] [39] [74], checked 7 October 2026. Back to contents.

How does climate change reshuffle the cards? ETS, CBAM, stranded assets

Climate policy turns emissions into a cost and climate damage into a risk. The EU caps industrial emissions and makes firms buy allowances [75]; since 1 January 2026 importers pay for the carbon in some goods [76]. Assets built for a high-carbon world can lose value early [77], and adaptation needs far exceed today's finance [78]: new markets on both sides.

After this section you can say which of ETS, CBAM, ETS2 and the CO2 tax touches each link of a supply chain.

§7 priced one tonne in one country. Climate policy now prices tonnes along whole supply chains, and the physical climate changes what buildings, harvests and insurance cost. For a small firm this shows up twice: as a line in the price of what it buys, and as demand for whatever cuts emissions or protects against heat and floods.

Key ideas.

  • The EU Emissions Trading System is based on a cap and trade principle [75], set up by Directive 2003/87/EC [79]. Covered power and industry emissions were about 47 % below 2005 by 2023, the cap is tightened to 62 % below 2005 by 2030, and maritime transport is included from 2024 [75].
  • CBAM applies in its definitive regime from 1 January 2026, with authorisation, reporting and the purchase of certificates for embedded emissions [76]. It answers carbon leakage, when climate costs push production to other countries [80].
  • ETS2, for buildings, road transport and additional sectors, will be fully operational in 2028, upstream on fuel suppliers [81]. The EU's 2040 target is a 90 % net cut from 1990, with up to 5 % from international credits [82].
  • The physics behind the bill: human activities have unequivocally caused global warming, 1.1 °C over 2011 to 2020 against 1850 to 1900 [83]; impacts and the limits of adaptation are assessed by IPCC Working Group II [84].
  • Adaptation: UNEP's 2025 report puts the financing needs of developing countries at 12 to 14 times current international public flows [78]; the EEA identifies 36 climate risks for Europe [85]; the EU strategy asks to adapt faster, in a smarter and more systemic way [86].

CBAM, simply

CBAM puts on imported goods the carbon price that EU producers already pay under the ETS. Since 1 January 2026 an importer of goods in its scope needs an authorisation, reports the emissions embedded in them and buys certificates to cover them [76]. It covers the goods set by the Regulation, not all imports [80].

Stranded assets

IPCC Working Group III warns that delay in aligning finance with climate goals “will result in significant carbon lock-ins, stranded assets, and other additional costs” [77]. A stranded asset is a furnace, a pipeline or a building that loses its value before the end of its planned life. Mark Carney called the gap between the time of climate costs and the horizon of markets the tragedy of the horizon [87]; central banks now publish shared climate scenarios to test it [88].

Figure 8.1 follows one steel coil from plant to shop.

Who pays for a tonne.A steel coil travels from a plant across the EU border by van to Maria's shop. Tags light in turn: ETS allowances at an EU plant, a CBAM certificate at the border from 2026, the Luxembourg CO2 tax and ETS2 from 2028 on the van's fuel, a stranded asset tag on an old furnace, and adaptation work on the shop.Steel plantEU borderVanMaria's shopEU plant: ETSallowancesMade outside:CBAM, from2026Diesel: CO2tax (LU)todayOld furnace:strandedassetETS2 at thefuelsupplier,2028Floods, heat:adaptation
All 5 steps

Every tag at once. Press Next to follow the coil link by link.

  1. 1Made in an EU plant: the plant surrenders ETS allowances for its emissions.
  2. 2Made outside the EU: from 2026 the importer buys CBAM certificates at the border.
  3. 3The van's diesel: Luxembourg's CO2 tax today, and ETS2 at the fuel supplier from 2028.
  4. 4An old furnace built for a high-carbon world: a stranded asset.
  5. 5The shop: flood defences and heat-proofing, the adaptation market.
Figure 8.1: Who pays for a tonne. Carbon becomes a line in every price of the chain, and a risk on every asset built for the old one. Sources: [75] [76] [81] [33] [77] [78]

Example 8.1 (Luxembourg and the Greater Region)

Maria fits out her Luxembourg City shop: steel shelving and a delivery van. Which instrument touches which link? If the steel is made in an EU plant, the plant surrenders ETS allowances [75]. If it is made outside the EU and imported, the importer buys CBAM certificates for goods in the Regulation's scope [76] [80]. The van's diesel carries Luxembourg's CO2 tax today [33], and ETS2 adds an EU price upstream, at the fuel supplier, from 2028 [81].

The national frame: for 2030, Luxembourg's energy and climate plan targets a 55 % cut in greenhouse gases outside the ETS against 2005, 37 % renewables and a 42 % gain in energy efficiency [32].

Remark 8.1 (Common misreading: “CBAM is a tariff on all imports”). It covers the goods whose embedded emissions the Regulation brings into scope, and mirrors the phase-out of free ETS allowances for the same goods [76] [80].

Quiz 8.

  1. 8.1 Since when does CBAM apply in its definitive regime?

    Answer

    Answer (b): Since 1 January 2026 [76].

  2. 8.2 In ETS2, who is regulated and reports the emissions?

    Answer

    Answer (c): ETS2 is designed upstream, on fuel suppliers [81].

  3. 8.3 UNEP 2025: adaptation financing needs of developing countries are about how many times current international public flows?

    Answer

    Answer (c): 12 to 14 times, according to the Adaptation Gap Report 2025 [78].

Go further (free)

On this site

Sources for §8: [75] [76] [77] [78] [79] [80] [81] [82] [83] [84] [85] [86] [87] [88] [33] [32] [74] [89], checked 7 October 2026. Back to contents.

What is the blue economy? Two meanings, Pauli and the ocean

The term has two meanings. Gunter Pauli's Blue Economy, a 2010 report to the Club of Rome, is a business model that copies ecosystems so that one process's waste feeds another [90] [91]. The EU and World Bank blue economy is the economy of oceans and coasts, managed sustainably [92]. The World Bank itself notes the term is used in different ways [93].

After this section you can tell which blue economy a text means, and say where each definition comes from.

Search results usually give one meaning and ignore the other. The two share nothing but a colour: one is about how production is designed, anywhere; the other is about the sea. Table 9.1 sets them side by side.

Pauli's Blue Economy

The Club of Rome says the Blue Economy began as a project to find 100 of the best nature-inspired technologies; from 2,231 peer-reviewed articles the team found 340 innovations [90]. Pauli's own site defines it as “the regeneration of ecosystems in a logic of abundance and autonomy” [91]. ZERI, the research network behind it, was founded by Pauli in 1994 with the support of the United Nations and the Japanese government [94].

The ocean blue economy (EU, World Bank)

The World Bank and UN DESA wrote in 2017: “Although the term ‘blue economy’ has been used in different ways”, it is understood as the economic sectors and policies that together decide whether the use of ocean resources is sustainable [93]. That is the ocean blue economy. The European Commission asked in 2021 to shift the focus from blue growth to a sustainable blue economy [92], and publishes its data through the EU Blue Economy Observatory [95] and DG MARE [96]. The World Bank today promotes the sustainable use of marine resources [97].

Table 9.1: Two blue economies, each from its own sources. Rows checked on 7 Oct 2026.
AspectPauli's Blue EconomyOcean blue economy (EU, World Bank)
Author and dateGunter Pauli, report to the Club of Rome, 2010 [90]World Bank and UN DESA, 2017 [93]; European Commission, 2021 [92]
Core ideaRegenerate ecosystems; one process's output feeds the next [91]Use ocean resources sustainably, across sectors [93]
Unit of analysisA production process and its cascadeAn economic sector, a sea basin
Examples named by the source340 nature-inspired innovations found in the literature [90]Ocean-related activities mapped by the Observatory [95]
Main sourcetheblueeconomy.org [91]; ZERI [94]World Bank topic page [97]; DG MARE [96]

Figure 9.1 draws both maps, one after the other.

Same words, two maps.Top: three generic processes A, B and C where each output becomes the next input, with a counter of waste out at zero. Bottom: a coastline with five sectors, shipping, fisheries, aquaculture, offshore renewables and coastal tourism, above a sustainability gauge. A final caption notes that the term is used in different ways.Pauli: a cascade of processesprocess Aprocess Bprocess Coutput = inputwaste out: 0Ocean: the sectors of the seashippingfisheriesaquaculturerenewablestourismuse of the sea: sustainable?“used in different ways” (World Bank, UN DESA, 2017)
All 5 steps

Both maps at once. Press Next to draw Pauli's cascade, then the ocean sectors.

  1. 1Pauli: the output of process A becomes the input of process B.
  2. 2B feeds C in turn: nothing leaves the cascade as waste.
  3. 3The ocean meaning: sectors along a coast, from shipping to coastal tourism.
  4. 4What it asks is whether their use of the sea is sustainable.
  5. 5Same two words, two maps: the World Bank notes the term has been used in different ways.
Figure 9.1: Same words, two maps. Pauli's Blue Economy is a cascade of processes; the ocean blue economy is a map of sea sectors. Sources: [91] [90] [93] [92]

Example 9.1 (Luxembourg)

A landlocked country has an ocean blue economy too. The government's investment pages say that more than 200 ships fly the Luxembourg flag and that around 225 companies of the sector are established in the country [98]; the public maritime register goes back to the law of 9 November 1990 [99].

Pauli's meaning has no Luxembourg source read for this page, so the example gives none. For Maria it is a design question rather than a fact: what could one process's leftover feed in another?

Remark 9.1 (Common misreading: “the blue economy is the green economy at sea”). Only the ocean meaning is about the sea; Pauli's meaning is about production systems anywhere, a city bakery included [91] [93].

Quiz 9.

  1. 9.1 Gunter Pauli's Blue Economy was published as a report to ...

    Answer

    Answer (b): A report to the Club of Rome, in 2010 [90].

  2. 9.2 The World Bank and UN DESA define the blue economy around ...

    Answer

    Answer (b): The sectors and policies that decide whether the use of ocean resources is sustainable [93].

  3. 9.3 About how many ships fly the Luxembourg flag?

    Answer

    Answer (c): More than 200, according to the government's page on the maritime sector [98].

Go further (free)

Sources for §9: [90] [91] [92] [93] [94] [95] [96] [97] [98] [99] [100], checked 7 October 2026. Back to contents.

Sitraka FORLERsystems architect, Luxembourg
The entrepreneur's toolkit
Part III of IVnext: Ahead →

Entrepreneurship in the age of AI: where are we heading?

AI makes building cheap and fast, so evidence becomes the scarce part. In one field study an AI assistant raised support agents' productivity 14 % on average and 34 % for novices [101]; a macro estimate caps total productivity gains near 0.66 % over ten years [102]. Blank now calls AI-built prototypes untested products [103]. Growth still comes from creative destruction [9].

After this section you can explain the IUP idea and weigh the micro and macro evidence on AI.

An entrepreneur in 2026 can have a working prototype in an afternoon. That changes the order of the work, not its point: the prototype was never the hard part of a new venture; knowing who will pay, and why, was. The research record on AI holds two findings that look opposed and are both true at their own scale.

Key ideas.

  • Brynjolfsson, Li and Raymond: access to the tool raises productivity “by 14% on average, including a 34% improvement for novice and low-skilled workers” [101].
  • Acemoglu estimates no more than a 0.66 % increase in total factor productivity over ten years [102]. The micro gain and the macro caution are both in the record.
  • Stanford's AI Index 2025 reports that business is all in on AI, with record investment and usage [104].
  • Blank asked in September 2026 whether AI had killed his Lean LaunchPad class [105]; his answer keeps the method, because AI “doesn’t accelerate understanding, evidence or insight” [106].
  • The EU AI Act asks providers and deployers of AI systems to ensure a sufficient level of AI literacy of their staff (Article 4) [107]. The dates that apply to agents are on the AI agents page of this site, linked below, rather than restated here.
  • Where we are heading, in institutions' words rather than this page's forecast: the Nobel committee ties sustained growth to creative destruction [11]; the Draghi report says the green and digital transitions demand unprecedented levels of investment and innovation [108]; the EU Startup and Scaleup Strategy of May 2025 aims to make the EU the best place to launch and grow technology-driven companies [109].

From MVP to IUP

In his post of 25 September 2026, Blank argues that once AI could build a working product on day one, the minimum viable product was no longer a useful artefact for customer discovery; his class now calls those first builds Initial Untested Products, or IUPs [103]. The word that matters is untested. Figure 10.1 puts the two timelines side by side.

Build cheap, prove dear.Two timelines. 2016, MVP: eight weeks of building, then six weeks of interviews. 2026, IUP: the build shrinks to four weeks, then two days, while the six weeks of interviews keep their length. Gauges show plus 14 % productivity on average and plus 34 % for novices in one field study, and at most 0.66 % total factor productivity over ten years in a macro estimate.2016 · MVPbuild 8 wkinterviews 6 wk2026 · IUPbuild 8 wkinterviews 6 wkbuild 4 wkinterviews 6 wkbuild 2 daysinterviews 6 wkField study, support agents (NBER, 2023)+14 % average+34 % novicesMacro estimate, whole economy (NBER, 2024)at most 0.66 % TFP over 10 years
All 5 steps

Both timelines and both gauges at once. Press Next to shrink the build step by step.

  1. 12016: an MVP takes eight weeks to build, then six weeks of interviews.
  2. 2With better tools the build halves to four weeks; the interviews do not move.
  3. 32026: an AI assistant builds a first version, an IUP, in two days. The evidence bar keeps its length.
  4. 4Micro evidence: an AI assistant raised support agents' productivity 14 % on average, 34 % for novices.
  5. 5Macro caution: at most about 0.66 % more total factor productivity over ten years.
Figure 10.1: Build cheap, prove dear. AI shrinks the build; the evidence still takes the weeks it took (build durations Illustrative). Sources: [103] [101] [102] · Illustrative

Example 10.1 (Illustrative, Luxembourg City)

Maria, now in Luxembourg City, uses an AI assistant to build a pre-order page in one afternoon: an IUP. The week's real work is the same as in Thionville: twelve interviews and three paying pre-orders before she bakes a new line. Luxinnovation [14] and the House of Startups [110] are places to meet others doing the same; what an agent can and cannot do is on the page linked below.

Remark 10.1 (Common misreading: “AI replaces customer discovery”). Blank's 2026 course keeps customer development, hypothesis testing, field interviews and weekly evidence reviews [106]. The tool speeds up the build, not the proof.

Quiz 10.

  1. 10.1 In the NBER field study, who gained most in productivity from the AI assistant?

    Answer

    Answer (b): A 34 % improvement for novice and low-skilled workers, against 14 % on average [101].

  2. 10.2 What does IUP stand for in Blank's 2026 class?

    Answer

    Answer (a): Initial Untested Products, the AI-built first versions [103].

  3. 10.3 What is Acemoglu's estimate of AI's total factor productivity gain over ten years?

    Answer

    Answer (a): No more than a 0.66 % increase over ten years [102].

Go further (free)

On this site

Sources for §10: [101] [102] [103] [9] [104] [105] [106] [107] [11] [108] [109] [14] [110] [111], checked 7 October 2026. Back to contents.

Sitraka FORLERsystems architect, Luxembourg
The entrepreneur's toolkit
Part IV of IVnext: The toolkit →

The toolkit: free courses from Stanford, Harvard, MIT, HEC

Thirty-one free resources, sorted by section. The Access column uses the page's own words, as read on 7 October 2026; a Coursera course points to Coursera's own terms.

Table T.1: The free resources, section by section.
§InstitutionResourceFormatAccess (as read on 7 Oct 2026)
§1Stanford STVPeCorner, Entrepreneurial Thought Leaders [16] [112]talks, podcastsopen site
§1MIT OCW15.351 Managing Innovation and Entrepreneurship [17]course materialsOCW (free)
§1NobelPrize.orgPrize in economic sciences 2025, scientific background [10]PDFopen
§2MIT OCW14.02 Principles of Macroeconomics (Caballero, 2023) [35]videos, problem setsOCW (free)
§2HarvardXJustice Today: Money, Markets, and Morals [36]course“Audit for Free”
§2IMF, Finance & DevelopmentWhat Is Keynesian Economics?; Neoliberalism: Oversold? [21] [22]articlesopen
§3MIT OCW14.01 Principles of Microeconomics (Gruber, 2023) [39]videos, examsOCW (free)
§3MIT OCW14.12 Economic Applications of Game Theory (2025) [40]videos, notesOCW (free)
§3MIT OCW15.025 Game Theory for Strategic Advantage [44]course materialsOCW (free)
§4Udacity (Steve Blank)How to Build a Startup [52]video course“Free Course”
§4MIT OCW15.390 New Enterprises (Aulet et al., 2013) [51]videos, assignmentsOCW (free)
§4MIT OrbitEntrepreneurship 101 (15.3901) [50] [48]course pageopen page
§4Steve BlankStartup Tools; Lean LaunchPad posts [54] [106]articles, videosopen
§4NSFI-Corps [46]programmeUS programme (eligibility on the page)
§4Disciplined EntrepreneurshipFree chapters [47]PDF chapters“Download free chapters”
§5MIT OCW15.010 Economic Analysis for Business Decisions [61]course materialsOCW (free)
§5HBS OnlineBusiness Insights blog [62]articlesopen
§6Harvard PONBATNA, ZOPA and anchoring articles [63] [64] [65]articlesopen
§6MIT OCW15.665 Power and Negotiation (2014); 15.067 [68] [69]simulations, notesOCW (free)
§7MIT OCW14.44 Energy Economics [74]course materialsOCW (free)
§7Internet ArchivePigou 1920, Knight 1921, Cournot (1897 translation) [70] [3] [38]full textspublic domain scans
§8IPCCAR6 Synthesis Report [83]reportopen
§8NGFS, IEAPhase V scenarios; World Energy Outlook 2025 [88] [89]data, reportopen pages (the IEA asks you to sign in for some downloads)
§9European CommissionEU Blue Economy Observatory [95]dataopen
§10Stanford HAIAI Index 2025 [104]reportopen
§10Stanford GSBInsights by Stanford Business [111]articlesopen
allStanford OnlineFree Online Courses catalogue [100]catalogue“at no cost to you”
alledXStanford courses on edX [113]catalogue“free online courses” (certificates paid)
allHarvardFree courses catalogue; Entrepreneurship in Emerging Economies (Khanna) [114] [115]catalogue, course“Free” filter on the catalogue
allHEC ParisInnovation & Entrepreneurship Center and Incubateur HEC Paris; CDL-Paris [18] [116]programmessee the page
allHEC Paris on CourseraPartner page; Entrepreneurship Strategy: From Ideation to Exit [117] [55]coursessee Coursera's terms
allMITMartin Trust Center for MIT Entrepreneurship [118]centreopen site

Glossary

Each term links to the section that explains it. A dotted underline in the text opens the same definition.

Entrepreneur
A person who commits resources at a known price to sell at a price nobody knows yet, and carries the risk and the conduct of the concern. [1] [2] see §1
Uncertainty (Knight)
A chance that cannot be measured, unlike risk, which can. Knight's explanation of why profit exists. [3] see §1
Creative destruction
Growth through new technologies and products replacing old ones, and the firms that sold the old ones losing out. [4] [11] see §1
Oligopoly
A market with a few sellers who each take the others into account. [39] see §3
Cournot equilibrium
The quantities at which no firm wants to change its output, given the output of the others; the price follows from the total. [38] see §3
Externality
A cost or a benefit of an activity that falls on people outside the deal, such as smoke on the neighbours' washing. [70] see §7
Pigouvian tax
A tax equal to the harm an activity does to others, so that its price includes that cost. [70] see §7
Transaction costs
The costs of finding, negotiating and enforcing a deal. When they are high, bargaining fails and institutions decide. [72] [71] see §7
BATNA
Best alternative to a negotiated agreement: what you will do if this deal fails, the measure of any offer. [63] see §6
ZOPA
Zone of possible agreement: the range where the two sides' limits overlap. [64] see §6
Anchoring
The pull of the first number on later judgments, strongest when the bargaining zone is unclear. [65] [59] see §6
Cap and trade
A ceiling on total emissions, with allowances that firms must hold for each tonne and can buy or sell. [75] see §8
Carbon leakage
Production moving to other countries because of the cost of climate policies at home. [80] see §8
Stranded asset
A plant, a pipeline or a building that loses its value before the end of its planned life, because of climate policy or climate change. [77] see §8
Blue Economy (Pauli)
Gunter Pauli's business model, a 2010 report to the Club of Rome: production that copies ecosystems, one process's output feeding the next. [90] [91] see §9
Blue economy (ocean)
The economic sectors and policies that together decide whether the use of ocean resources is sustainable. [93] [92] see §9
IUP
Initial Untested Product: Blank's 2026 name for a first version built quickly with AI and not yet tested with buyers. [103] see §10

References

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About this page

Sources. 118 numbered sources, each opened and read on 7 October 2026: original texts 20, prize committees and international institutions 10, Harvard Business Review articles 6, Luxembourg 9, university courses and centres 24, start-up method 10, selling and negotiation 7, climate and carbon pricing 16, blue economy 10, AI and the outlook 6. The original texts come from Gallica, Internet Archive, Project Gutenberg and the Marxists Internet Archive; no online encyclopedia and no summary site is cited.

Neutrality. The four schools of §2 are each given in their own terms, with the same number of cells, then with their critique from outside. The page does not choose between them and gives no investment advice.

Numbers. A number without a source carries the word Illustrative, in the example head and in the figure caption. Friedman's 1970 essay is not cited: no accessible copy could be read.

Method. Researched and drafted with the help of Claude Code, an Anthropic product; every fact checked against the source listed.